do you like this deal?

[Jared Kott]

Hello all,

I am really beginning to hate corporate america, I have a well paying job ( that i hate ) that I will be loosing in the next 45-60 days. So my plan is to acquire an income generating property within 45-60 while i still show income.

I have a condo worth about 200k that was bought cash. ( small loan still being paid to relative) So i will be a first time home buyer as far as banks know.

THE DEAL:
Nice neighborhood in Chicago.
Sell price 305,000
Bank owned 3 flat with garden.
3/1 and 1/1
Will use FHA and put between 3.5 - 5% DP.
Annual Gross income = 43,200
If I use the 50% rule I am at a 7% Cap rate by my math.
I will update the property ( it needs it - cosmetics - and is vacant now ) using some instant equity that will be built into the deal - will appraise at 360,000 as is - put 35k using that equity and increasing rents by 10 - 12%.
Trying to close by 12/20. DO YOU LIKE THIS DEAL given my situation stated above?

The second deal is a 6 unit fully rented 2/1 also in same neighborhood in Chicago.
Building is fully rented and in good shape.
Owners will "owner finance" asking 499k looking to offer 400k or so with 10-15% DP.
Gross income = 57,600
Asking 499
offering 400-425k
Partners are going different directions they want out.
57,600 / 2 = 28,800 / .067

I know with commercial properties banks want 30% DP - this would wipe me out and leave me with nothing for reserves or living expenses. So the owner financing sounds attractive. Would you offer a higher percentage rate for a lower selling price? How high would you go giving the deal above?

I am also trying to close this by 12/20 and do a double close and get into this business full time.

I am excited about this but not sure I am going down the right road out of the gate. Would you do these deals, and risk your savings, knowing your steady income is leaving within 60 days?

Thanks,
The excited investor